$500m Fonterra site poses challenges

Challenges are involved in the Fletcher Construction-Goodman Group joint venture to build a $500 million office precinct on a site near Auckland's waterfront.

Greg Pritchard, Fletcher Construction Building + Interiors general manager, said water was only about 3m below ground level at high tide, so Fletcher would bring its specialist pile-driving expertise from the ASB North Wharf site to the new precinct.

How many piles needed to be sunk for the Fonterra block was not known and the builder is yet to appoint a project manager, although Pritchard said Fletcher Construction's Alan Gray, who ran ASB North Wharf, would be involved in some way.

"It will be the end of the year before we start construction to meet a phased programme. There will be plenty of time to transfer from ASB to Fonterra," Pritchard said.

Yet the same workforce would not move as one. "It will be a bit mixed up. The building work will take 24 months."

The joint venture will first develop new offices valued at $60 million to $80 million for Fonterra, then a further three to four blocks are planned on the site bounded by Halsey, Gaunt, Daldy and Fanshawe Sts.

Graham Darlow, chief executive of Fletcher Building's construction division, said the Fonterra project would be a much-needed help for the building sector, which has not been busy in the past few years.

"When projects like Fonterra's proposal come about, especially in the current climate, it does lift the level of confidence in the commercial construction sector ... the benefits to the sector are considerable."

Pritchard said he was working with Goodman development manager Peter Dafaur. He said the VHHL (Viaduct Harbour Holdings Ltd) land was not in the Wynyard Quarter. Goodman Property Trust says Dafaur is "responsible for all development activities for Goodman including the Highbrook Business Park".

Neither Fletcher nor the Goodman trust issued any NZX notice when they won the Fonterra job. Only the dairy giant issued a statement, from Chris Caldwell, managing director of people, culture and services.

"While there was still some work to do before the co-operative would sign a lease, the preferred site would enable all Fonterra's employees in the area to be based in one location, instead of several as they are now," Caldwell said.

"Being closer together will enable our people to work together more seamlessly. This will provide a real opportunity to enhance the way our people feel about coming to work every day."

Fonterra will not own or develop the building. It will be developed by the Goodman Group/Fletcher Building partnership and ultimately owned by the Goodman Group. Fonterra would take a long-term lease, Caldwell said.

The co-operative is in several buildings around Auckland's CBD but its main office is at 9 Princes St.